MG Properties Group, a private San Diego-based real estate investor and operator, acquired Manzanita Gate Apartments, a 324-unit multifamily property in Reno, Nev., for $27 million.
The REO property was purchased from a large Midwest-based loan servicer represented by Phil Saglimbeni and Kenneth Blomsterberg of Marcus & Millichap.
The acquisition was financed with a $21.6 million fixed-rate loan from Fannie Mae arranged by Rob Prouty at Key Bank Real Estate Capital.
Manzanita Gate offers a mix on one- and two-bedroom apartment homes that average 940 square feet. MGPG plans to complete minor interior upgrades, update the common areas and remedy deferred maintenance issues such as the roofs and windows, to improve the resident quality of life.
Mark Gleiberman, president of MG Properties, said the company entered this community in the Reno market because the property was not keeping up with collections growth after more than a year of REO operations like other housing units.
“This is a desirable secondary market opportunity that leverages our Northern California operations platform, allowing us to add value through both asset and operational improvements while benefiting from a strengthening Reno apartment market,” Gleiberman added. “We are wary of high-turnover commodity apartments in secondary markets where residents have a history of concession shopping and by operating Manzanita Gate as a destination property, we will be able to reduce turnover, hold occupancies high and allow our staff to really focus on serving our residents.”
Since December 2010, MGPG has completed seven apartment acquisitions at a value of more than $215 million. The company anticipates closing an additional $200 million in acquisitions within the next 12 months.
